Sarrat et al v. Univar USA, Inc.

Filing 8

ORDER denying 5 Motion to Dismiss for Failure to State a Claim. Signed by Judge Mary Ann Vial Lemmon on 7/17/14. (cbn)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
WALTER SARRAT AND HILDA
SARRAT

CIVIL ACTION

VERSUS

NO: 14-1017

UNIVAR U.S.A., INC.

SECTION: "S" (2)
ORDER AND REASONS

IT IS HEREBY ORDERED that Univar USA Inc.'s Motion to Dismiss Paragraphs 54-59
of the Complaint as they relate to a claim for fraud (Doc. #5) is DENIED.
BACKGROUND
This matter is before the court on a motion to dismiss plaintiffs' fraud allegations filed by
defendant, Univar USA Inc. Univar argues that the fraud allegations found in paragraphs 54 through
59 of the complaint must be dismissed because plaintiffs, Walter and Hilda Sarrat, failed to plead
fraud with particularity as is required by Rule 9(b) of the Federal Rules of Civil Procedure.
Plaintiffs allege that from 1967 through 1969, Walter was employed by Gencote, Inc. as a
polyurethane applicator, and that the work involved using toluene, which contains up to 2.5%
benzene. They allege that the toluene was sprayed in a "very fine breathable mist" directly onto
Walter's skin and clothing, and that he was unaware that toluene contained benzene, which causes
cancer, because he was "advised that toluene was safe and posed no hazard to his health in the
manner it was being used." Plaintiffs allege that Gencote purchased the toluene from ChemCentral,
Inc. a/k/a Southern Solvent & Chemicals Corporation, which merged into Univar.
Plaintiffs allege that Walter developed Chronic Lymphocytic Leukemia as a result of his
exposure to benzene in the toluene provided by Univar's predecessor. Plaintiffs claim that there
were no warning labels on the chemicals, and that the supplier knew or should have known of the

health hazards their product posed. Plaintiffs allege that Univar is liable under theories of
negligence, strict product liability, and "concealment, misrepresentation, fraud." Univar has moved
to dismiss plaintiffs' fraud allegations, arguing that they are not pleaded with sufficient particularity.
ANALYSIS
A.

Rule 12(b)(6) of the Federal Rules of Civil Procedure
Rule 12(b)(6) of the Federal Rules of Civil Procedure permits a motion to dismiss a

complaint for failure to state a claim upon which relief can be granted. To survive a Rule 12(b)(6)
motion to dismiss, enough facts to state a claim for relief that is plausible on its face must be
pleaded. In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007) (quoting Bell Atl.
v. Twombly, 127 S.Ct. 1955, 1964-65 & 1973 n. 14 (2007)). A claim is plausible on its face when
the plaintiff pleads facts from which the court can “draw the reasonable inference that the defendant
is liable for the misconduct alleged.” Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). “Factual
allegations must be enough to raise a right to relief above the speculative level, on the assumption
that all the allegations in the complaint are true (even if doubtful in fact).” Bell Atl., 127 S.Ct. at
1965. The court “must accept all well-pleaded facts as true and view them in the light most
favorable to the non-moving party.” In re S. Scrap Material Co., LLC, 541 F.3d 584, 587 (5th Cir.
2008). However, the court need not accept legal conclusions couched as factual allegations as true.
Iqbal, 129 S.Ct. at 1949-50. In considering a motion to dismiss for failure to state a claim, a district
court may consider only the contents of the pleading and the attachments thereto. Collins v. Morgan
Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir. 2000) (citing FED. R. CIV. P. 12(b)(6)).

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B.

Rule 9(b) of the Federal Rules of Civil Procedure
Rule 9(b) requires that “[i]n alleging fraud or mistake, a party must state with particularity

the circumstances constituting fraud or mistake.” FED. R. CIV. P. 9(b). “[S]tate-law fraud claims
are subject to the pleading requirements of Rule 9(b).” Dorsey v. Portfolio Equities, Inc., 540 F.3d
333, 338-39 (5th Cir. 2008). “A dismissal for failure to state fraud with particularity as required by
Rule 9(b) is a dismissal on the pleadings for failure to state a claim.” Flaherty & Crumrine Preferred
Income Fund, Inc., 565 F.3d 200, 206 (5th Cir. 2009). “Rule 9(b) states that ‘in alleging fraud or
mistake, a party must state with particularity the circumstances constituting fraud or mistake.’” Id.
at 206-07. “Rule 9(b) does not ‘reflect a subscription to fact pleading’ and requires only ‘simple,
concise, and direct’ allegations of the ‘circumstances constituting fraud,’ which after Twombly must
make relief plausible, not merely conceivable, when taken as true.” U.S. ex rel Grubbs v.
Kanneganti, 565 F.3d 180, 186 (5th Cir. 2009). “The frequently stated, judicially-created standard
for a sufficient fraud complaint . . . instructs a plaintiff to plead the time, place and contents of the
false representation, as well as the identity of the person making the misrepresentation and what that
person obtained thereby.” Id. (internal quotation and citation omitted).
Under Louisiana law, the elements of a claim for fraud or intentional misrepresentation are:
(1) a misrepresentation of a material fact; (2) made with intent to deceive; and (3) causing justifiable
reliance with resultant injury. Kadlec Med. Ctr. v. Lakeview Anesthesia Assoc., 527 F.3d 412, 418
(5th Cir. 2008). "In cases concerning fraudulent misrepresentation and omission of facts, Rule 9(b)
typically requires the claimant to plead the type of facts omitted, the place in which the omissions
should have appeared, and the way in which the omitted facts made the representations misleading."
Carroll v. Fort James Corp., 470 F.3d 1171, 1174 (5th Cir. 2006) (quotation omitted).

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Plaintiffs' complaint includes the following allegations regarding fraud:
CONCEALMENT, MISREPRESENTATION, FRAUD
54.
The Defendant was aware of the dangerous condition
presented by exposure to benzene, and that Mr. Sarrat would suffer
from diseases and other ill health effects as a result of these
exposures. Defendant failed and/or willfully withheld knowledge of
the health dangers from exposure to benzene.
55.
Under Louisiana law fraud may be either active or passive.
Passive fraud may arise from a defendant's silence or failure to act.
To state a claim for passive fraud, Louisiana courts generally require
a showing of the following elements: (1) the information that was
withheld, (2) the general time period during which the fraudulent
conduct occurred, (3) the relationship giving rise to the duty to speak,
and (4) what the person or entity engaged in the fraudulent conduct
gained by withholding then information. See Chrysler Credit Corp.
v. Whitney Nat'l Bank, 824 F.Supp. 587, 598 (E.D. La.1993). In
support of their fraud claims against the Defendants, the plaintiffs
would respectfully show as follows:
56.
Univar knew or should have known information on the
hazardous nature of benzene, including a publication from the U.S.
government agency for public health: “The Toxicity and Potential
Danger of Aliphatic and Aromatic Hydrocarbons”, W.F. Von
Oettingen, Division of Industrial Hygiene, National Institute of
Health, U.S. Public Health Service, 1942.
57.
Prior to 1967, Univar knew or should have known that
benzene exposure had numerous adverse effects on human health
including:
A. Death could be cause by short term exposure of 20,000
ppm;

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B. Chronic benzene poisoning could occur from repeated
absorption of small doses of benzene over a period of
days, weeks or months;
C. Death could be caused from chronic exposures to benzene
as a result of its effects on the blood;
D. Chronic benzene exposure could cause damage to the
nervous system, the gastrointestinal tract, to the liver,
kidneys, cause hemorrhages from the skin and mucous
membrane, and cause changes in the blood;
E. Benzene exposure could cause changes in the blood
including anemia, leukocytosis, lymphocytosis and
leukopenia, and thrombopenia;
F. The effect of benzene on the blood is as a result of
benzene causing an injurious effect on the bone-marrow
another myeloid structures;
G. Benzene exposed workers should undergo periodic
medical monitoring, particularly of changes in the blood;
H. Chronic benzene poisoning leads to injury of the bonemarrow;
I. Chronic Benzene exposure results from repeated or
continuous exposure to relatively low concentration of
benzene exposure;
J. The toxic action of chronic exposure is mainly exerted on
the hematopoietic system (blood forming tissues);
K. It could take months or even years for symptoms of
benzene exposure to manifest;
L. Possible effects on the blood are leukopenia (decrease in
white blood cells), neutropenia, severe anemia,
thrombopenia (drop in platelet count);
M.

Individual reactions to chronic benzene poisoning vary
as to their effects on the blood – it may cause a
decreases in red-cells, white-cells, platelet, any

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combination of these, a reduction or increase in cells in
the bone marrow, or leukemia.
58.
In spite of this knowledge, Univar failed to provide any health
warning on their drums of Toluene between 1967 and 1969.
Additionally, Univar failed to disclose its Toluene contained benzene,
that exposure to benzene was hazardous, or to provide any
information concerning recommended protective equipment.
59.
As manufacturer, sellers and distributors of the product,
Univar had a duty to inform users of the hazards associated with use
of the product.
The allegations comply with Rule 9(b), because they do allege the elements of fraud with
specificity. There is an allegation that Univar's predecessor had a duty to provide safety information
to users, that it knew of the dangers related to the product and willfully withheld that information.
Therefore, Univar's motion to dismiss is DENIED.
CONCLUSION
IT IS HEREBY ORDERED that Univar USA Inc.'s Motion to Dismiss Paragraphs 54-59
of the Complaint as they relate to a claim for fraud (Doc. #5) is DENIED.

New Orleans, Louisiana, this _____ day of July, 2014.

____________________________________
MARY ANN VIAL LEMMON
UNITED STATES DISTRICT JUDGE

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